Can I Buy Physical Gold in My IRA?

Individual Retirement Accounts, or IRAs, provide an effective vehicle for saving and investing for retirement. Their tax advantages make IRAs ideal investments as well. You can invest in various assets types through them.

An Individual Retirement Account (IRA) allows investors to invest in physical gold through coins and bullion bars; however, before making such an investment it is essential that fees and IRS rules are taken into consideration.

How to Buy Physical Gold in Your IRA

Monex has long provided top-tier customer service and quality IRA eligible bullion products to help individuals create precious metals IRA accounts. Furthermore, we provide a two-way buy/sell market so you can sell back gold to us when it comes time to distribute from your account.

First, you will require an IRA account with a reliable custodian who allows self-directed investments such as physical gold. Next, find an authorized dealer such as American Bullion or APMEX who offers IRS compliant gold bullion and coins that qualify as eligible investments for an IRA account.

Once you’ve selected gold bullion and coins for storage in an IRA account, send them directly to the custodian for safe keeping. Remember, however, that owning physical gold may not be as convenient as owning stocks, mutual funds, ETFs that track gold prices directly; your precious metals won’t be accessible as easily from storage facilities like they would through paper investments.

Taxes

Gold can often be seen as a reliable investment asset during times of economic turmoil, yet before making this commitment it is crucial that you speak to an independent fee-only financial planner who does not represent any precious metal IRA companies before investing.

Precious metal IRAs are subject to the same taxes and penalties as any retirement account. Any gains accrued while they’re held within your account won’t be taxed; once they’re withdrawn you will incur capital gains taxes and possibly penalties depending on your account type and age.

Purchase of physical precious metals through an IRA is generally more costly than investing in mutual funds or gold mining ETFs, due to storing, insuring, and transaction costs incurred when buying metals directly. Therefore, many investors prefer Self-Directed IRAs which eliminate such expenses while giving you greater freedom in choosing your precious metal dealer and depository.

Storage Options

Storage options for precious metal investments are of utmost importance. In general, you have two choices for storage of precious metals: commingled and allocated storage. Either way, ensure they are stored safely at a depository lest the IRS accuses you of taking taxable distributions prior to reaching retirement age.

Goldco does not advise using any loophole in the IRS code to store precious metals at home, despite claims by some companies of an exemption to do so. Establishing home storage accounts with banks or custodians can be complicated and time-consuming; moreover, audited accounts increase your risk of penalties from tax authorities.

Instead, look for a company offering both commingled and allocated storage options as you want your metals stored with care. Ask how your provider stores them; are their holdings separated from those of other clients or do they all reside together in one large pool?

Custodians

As physical gold supplies are finite, its scarcity makes it a secure investment and inflation hedge.

Traditional IRAs, 401(k)s and other conventional retirement accounts provide indirect exposure to precious metals; whereas self-directed IRAs allow direct ownership of physical coins and bullion for direct exposure – significantly expanding your options.

Custodians typically purchase gold from dealers in your preferred location before transporting it back to an approved depository for storage, helping keep your costs as low as possible. Selecting an ideal custodian will keep this cost minimal.

Finding a reputable company that specializes in gold IRAs and prioritizes client needs is key when setting up an IRA. Transparent fees and flexible approaches to meet your specific goals for an IRA should be sought out, along with experience buying/selling coins or bullion you plan to hold in it for your IRA account. Also look for one with a buyback program allowing you to sell IRA-eligible precious metals back when RMD time rolls around.


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